The White House is now bringing up talk that it will be releasing yet another government plan designed to assist those whose mortgages are upside-down. As you’d expect, unless you’re hopelessly optimistic, details are all but nonexistent at this time. We say “another” plan as if there was already one implemented that has actually done something for homeowners on a broad scale (as opposed to the mortgage modification scams). The plan should be announced in a few weeks, according to Treasury Secretary Timothy Geithner. He spoke at a Senate Banking Committee hearing last week in an effort to communicate the government’s plans to works towards economic recovery.
Geithner communicated that the Federal Housing Finance Agency is looking at a set of programs designed to greatly simplify the process homeowners would need to follow in order to refinance their homes at today’s record-low rates (precisely what has kept any prior plans from actually being effective). Presumably, the plan would be geared towards those homeowners whose mortgages are higher than the value of their homes (those who are upside-down).
Our difficulty is that the government seems to work both ends of the aisle, talking about coming up with plans to foster refinancing, while vilifying the very banks they need to work with in order to make that happen. At this point in time, the best solution seems to be economic growth, not “programs”, which will allow the economy to rebound and produce greater salaries, greater demand for homes, and thus economic and housing growth across the country.
